Commitments and Contingencies

9 Months Ended

Sep. 30, 2011

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies Disclosure [Text Block]

8.           Commitments and Contingencies

Legal

We are periodically involved in legal actions and claims that arise as a result of events that occur in the normal course of operations.  We are not currently aware of any legal proceedings or claims that we believe will have, individually or in the aggregate, a material adverse effect on our financial position or results of operations.

Operating Leases

We lease some of our operating and office facilities for various terms under long-term, non-cancelable operating lease agreements.  The leases expire at various dates through 2015 and provide for renewal options ranging from month-to-month to five years.  In the normal course of business, it is expected that these leases will be renewed or replaced by leases on similar properties.  The leases provide for increases in future minimum annual rental payments based on defined increases which are generally meant to correlate with the Consumer Price Index, subject to certain minimum increases.  Also, the agreements generally require us to pay certain costs (real estate taxes, insurance and repairs).

We and our subsidiaries have various lease agreements for the brewpub and gift store in Ukiah, California; the brewery at our Saratoga Springs, New York, facility; a building in the UK; and certain equipment.  The New York lease includes a renewal option for three additional five-year periods, which we intend to exercise, and some leases are adjusted annually for changes in the consumer price index.  The leases begin expiring in 2012.

Keg Management Agreement

In September 2009, we renewed the keg management agreement with MicroStar Keg Management LLC.  Under this arrangement, MicroStar provides all kegs for which we pay a service fee depending on the applicable territory.  The agreement is effective for five years ending in September 2014.  If the agreement is terminated, we are required to purchase four times the average monthly keg usage for the preceding six-month period from MicroStar.  We expect to continue this relationship.